California existing homes sales in August suffered the biggest year-over-year drop in nearly 25 years while the national median home price posted its first decline in more than a decade as the housing market showed more signs of erosion, according to figures released today.
Statewide sales of existing houses plunged 30.1% in August from the same month last year to a seasonally adjusted annual pace of 442,150 properties, according to the California Assn. of Realtors. That was steepest year-over-year decline since August 1982, when sales tumbled 30.4%
The California median sales price for existing homes rose an anemic 1.6% in August compared to the same month last year to $576,360. The median price is where half the homes sold for more and half sold for less.
Nationwide, the median sale price for all existing houses fell to $225,000 in August, a 1.7% drop from the same month last year, according to the National Assn. of Realtors.
It was the first such year-over-year decline since 1995 and the largest since 1993, according to economist Steven Wood of Insight Economics.
The drop in the sales rate has contributed to an increasing number of unsold existing homes, which totaled 3.92 million units in August — the highest supply since April 1993, according to the association.
While some housing industry analysts and economists say they expect the market to firm next year, others are not so sure.
"The speed of the collapse has been astonishing," economist Ian Shepherdson of High Frequency Economics stated in a research note. "With inventory still rising, there is no chance of any short-term relief. Prices and volumes have a long way to fall yet."
On a regional basis, the West was the only part of the nation in August to report an increase in the median sales price, a meager 0.3% rise to $345,000. Sales, meanwhile, fell 2.3%.
The median sales price in the Northeast fell 3.9% in August to $271,000 on a 1.9% sales increase. The Midwest posted a 1.1% decline in the median sales price to $176,000 but a 0.7% sales increase. In the South, the median sales price dropped 2.6% and sales slipped 0.8%.
You know, I just have one little question to ask here. How many consumers can afford to buy $576,000 dollar home, here in California, when the job prospects out here are low wage retail sales jobs that will pay $6.75 an hour--and with almost no benefits?
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